SEC extends pandemic-related relief

By Ken Tysiac

Relief provided to public companies, funds, and investment advisers affected by the coronavirus pandemic was extended by the SEC on Wednesday to cover a longer period.

Public companies now have a 45-day extension to file certain disclosure reports that otherwise would have been due between March 1 and July 1, according to a new SEC order. A previous notice of relief issued March 4 covered the period from March 1 to April 30.

The SEC also issued orders that gave certain investment funds and investment advisers additional time with respect to holding in-person board meetings and meeting certain filing and delivery requirements. This extends the filing period covered by the SEC’s original orders issued March 13. The orders are available here and here.

Conditions for public companies to utilize Wednesday’s order include a current report of a summary of why the relief is needed in the particular circumstances for each periodic report that is delayed.

For investment funds and investment advisers, the conditions include notifying SEC staff and/or investors, as applicable, of the intent to rely on the relief. Investment funds and advisers generally no longer need to describe why they are relying on the order or estimate a date by which the required action will occur.

The SEC’s Division of Corporation Finance also issued Disclosure Topic No. 9, which provides the division staff’s views regarding disclosure and other securities law obligations that companies should consider with respect to the coronavirus pandemic and related business and market disruptions.

In addition, the SEC encouraged companies and other related persons to consider their activities in light of their disclosure obligations under the federal securities laws, including insider trading laws.

“Health and safety continue to be our first priority,” SEC Chairman Jay Clayton said in a news release. “These actions provide temporary, targeted relief to issuers, investment funds, and investment advisers affected by COVID-19.

“At the same time, we encourage public companies to provide current and forward-looking information to their investors and, in these uncertain times, companies are reminded that they can take steps to avail themselves of the safe harbor in Section 21E of the Exchange Act for forward-looking statements.”

For more news and reporting on the coronavirus and how CPAs can handle challenges related to the pandemic, visit the JofA’s coronavirus resources page.

Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is the JofA’s editorial director.

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